Asistensi 3

-Government Policy
-Consumer Behavior
Pengantar Ekonomi 1

19 September 2023
 Tax on Sellers

A Tax on Sellers
Supply decreases and the curve S + tax on
sellers shows the new supply curve.

Impact
P* Increase
Q* Decrease

When a tax of $0.50 is levied on sellers, the supply

curve shifts up by $0.50 from S to S . The
1 2
equilibrium quantity falls from 100 to 90 cones.
The price that buyers pay rises from $3.00 to
$3.30. The price that sellers receive (after paying
the tax) falls from $3.00 to $2.80. Even though
sellers are legally responsible for paying the tax,
buyers and sellers share the burden.
 Tax on Buyers

A Tax on Buyers
Demand decreases and the curve D - tax on buyers
shows the new demand curve.

Impact
P* Increase
Q* Decrease

When a tax of $0.50 is imposed on buyers, the demand

curve shifts down by $0.50 from D to D . The
1 2
equilibrium quantity falls from 100 to 90 cones. The price
that sellers receive falls from $3.00 to $2.80. The price
that buyers pay (including the tax) rises from $3.00 to
$3.30. Even though buyers are legally responsible for
paying the tax, buyers and sellers share the burden.
 Tax

When Government Imposes Tax

Market fail to allocate efficient output → Dead Weight Loss
 Payroll Tax

A payroll tax places a wedge between what

firms pay and what workers receive.
Comparing wages with and without the tax
makes it clear that workers and firms share
the tax burden. This division does not
depend on whether the government
imposes the tax entirely on workers, imposes
it entirely on firms, or divides it equally
between the two groups.
 How Tax Burden is Divided

In panel (a), the supply curve is elastic, and the demand

curve is inelastic. In this case, the price received by
sellers falls only slightly, while the price paid by buyers
rises substantially. This means that buyers bear most of
the tax burden. In panel (b), the situation is reversed:
The supply curve is inelastic, and the demand curve is
elastic. In this case, the price received by sellers falls
substantially, while the price paid by buyers rises only
slightly. Here, sellers bear most of the burden.
 Subsidy on Sellers

A Subsidy on Sellers
Supply decreases and the curve S - subsidy on
buyers shows the new supply curve.

Impact
P* Decrease
Q* Increase
Subsidy

When Government
Imposes Subsidy
producers are producing at
a higher cost than what
buyers would be willing
to pay (wasteful trades) →
Dead Weight Loss
 Consumption Choice

Setiap rumah tangga harus membuat tiga
keputusan
dasar:
1. Berapa barang dan jasa yang diminta
2. Berapa jumlah tenaga /jam kerja yang disuplai
ke pasar tenaga kerja
3. Berapa pendapatan yang harus dihabiskan
saat ini dan disimpan untuk masa mendatang
Faktor yang mempengaruhi Permintaan Rumah
Tangga
• Harga produk barang/jasa tersebut.
• Pendapatan yang dimiliki rumah tangga.
• Jumlah kekayaan rumah tangga.
• Harga produk lain yang berkaitan.
• Selera dan preferensi rumah tangga.
• Ekspektasi rumah tangga mengenai pendapatan,
kekayaan, dan harga masa mendatang.
Consumption Choice

•Pilihan/kemungkinan konsumsi dibatasi oleh

pendapatan, harga barang X, dan harga barang Y.
•Sehingga, jika seseorang menghabiskan seluruh
pendapatan/anggaran dia, maka dia akan mencapai
batas kemungkinan konsumsinya.
• Budget Line: Garis atau kurva yang menghubungkan
titik-titik kombinasi konsumsi dua barang yang
membutuhkan pendapatan/anggaran yang sama.

❑ Budget Line adalah batasan optimum pada pilihan

konsumsi individu.
❑ Individu dapat memperoleh poin apa pun di
sepanjang budget line atau di dalamnya.
(affordable)
❑ Individu tidak dapat membeli poin di luar budget
line-nya (unaffordable)
 Consumption Possibilities

Budget Equation
Kita bisa membuat budget line berdasarkan persamaan PXQX + PYQY = Income
anggaran (budget equation) yang dimiliki oleh tiap
individu. Bagi keduanya dengan PY

Budget equation: (PX/PY)QX + QY = Income/PY

Expenditure = Income Lalu, pindahkan (PX/PY)QX ke sisi kanan

Misal:
Px: harga barang di sumbu x
Qy: barang y yang bisa dibeli
Py: harga barang di sumbu y
Qx: barang x yang bisa dibeli
Income: pendapatan
persamaan
QY = Income/PY – (PX/PY)QX
Y/PX: Real income individu terhadap barang X
Y/PY: Real income individu terhadap barang Y
PX/PY: Relative price barang X terhadap barang Y

PXQX + PYQY = Income

 Consumption Possibilities

❑ Pendapatan riil (real income) : pendapatan riil yang diukur dari

berapa banyak kuantitas yang mampu dibeli oleh rumah
tangga/individu.

❑ Kalau dalam kasus Lisa, pendapatan riil dia terhadap suatu

barang, misal soda, adalah ketika budget line berpotongan
dengan sumbu-y, atau ketika Lisa menghabiskan seluruh
pendapatannya untuk membeli soda (Y/Psoda ).

❑ Harga relatif (relative price): perbandingan harga suatu barang

(di sumbu x) terhadap harga barang lain (sumbu y), atau
menunjukkan seberapa banyak barang x yang harus dikorbankan
untuk menambah satu barang y.

❑ Harga relatif (relative price): besaran slope dari budget line.

❑ Kalau dalam kasus Lisa, harga relatif adalah perbandingan

harga soda dengan harga film (Pmovie/Psoda ).
Budget Line

• Lisa’s Real Income (subject to soda or Y’s good):

(Income/Py) = (Income/Psoda) = 40/4 = 10 soda

• Lisa’s Relative Price (of a movie in term of soda):

(Px/Py) = (Pmovie/Psoda) = 8/4 = 2 soda

• Slope Budget Line Lisa:

-(Px/Py) = -(Pmovie/Psoda) = - (8/4) = -2
 Budget Line
● The budget constraint shows the various combinations of goods the consumer can
afford given his or her income and the prices of the two goods

Hendra’s income : Rp1.200.000

Price of egg : Rp4.000/each
Price of orange : Rp1.000/each

● If Hendra spends all his income on egg,

he will buy 300 eggs
● If Hendra spends all his income on
orange, he will buy 1.200 oranges
● If Hendra buys 100 eggs, he will buy 800
oranges
 Budget Line
Change in Income Change in Price

Suppose Hendra’s Suppose the price of

income decrease to orange increase to
Rp800.000 Rp2.000/each

Perubahan Harga Relatif

Perubahan Pendapatan Nominal
• Apabila harga relatif berubah maka, kurva BL akan berotasi.
• Apabila pendapatan nominal naik, dengan asumsi ceteris
• Apabila harga barang X turun, maka kurva BL berotasi ke luar pada
paribus, maka kurva BL akan bergeser sejajar ke kanan.
poros sumbu Y, vice versa.
• Apabila pendapatan nominal turun, dengan asumsi ceteris
• Apabila harga barang Y turun, maka kurva BL berotasi ke luar pada
paribus, maka kurva BL akan bergeser sejajar ke kiri.
poros sumbu X, vice versa.
• Perubahan pendapatan nominal tidak akan mengubah
• Perubahan harga relatif juga ikut mempengaruhi perubahan slope
slope kurva BL.
kurva BL.
 Shifts in Consumer’s Budget Constraint

An increase in the consumer’s income a decrease in the price of pizza

a decrease in the price of Pepsi
shifts the budget constraint outward. shifts the budget constraint
shifts the budget constraint
The slope remains the same because outward. In these two cases, the
outward, while in panel
the relative price of pizza and Pepsi has slope changes because the relative
not changed price of pizza and Pepsi has
changed.
 Indifference Curve

•Indifference curve
–Curve that shows consumption bundles that give
the consumer the same level of satisfaction
•MRS, the marginal rate of substitution
–The rate at which a consumer is willing to trade one
good for another on an indifference curve
–Slope of the indifference curve
–Varies along an indifference curve
 Indifference Curve

•Points A, B, and all other bundles on I make

1
Russell equally happy.

•Point C on I , a higher indifference curve, is

2
preferred to points on I
1
MRS falls as you move down along an indifference
curve.
MRS = slope of the indifference curve
 Properties of Indifference Curve

1.Higher indifference curves are preferred to lower

ones.
–People usually prefer to consume more rather
than less.
2.Indifference curves slope downward.
–The slope of an indifference curve = MRS
–Rate at which a consumer is willing to substitute
one good for the other
–If the quantity of one good decreases, the
quantity of the other good must increase for the
consumer to be equally happy.
 Properties of Indifference Curve

3.Indifference curves do not cross.

–If they cross, two different points on two
indifference curves would bring the same
satisfaction: contradicts Property #1

4.Indifference curves are bowed inward.

–The slope of an indifference curve = MRS, which
depends on the amount of each good the
consumer is currently consuming.
–People are more willing to trade away goods that
they have in abundance
 Example of Indifference Curve
•Shape of an indifference curve
–Reveals the consumer’s willingness to trade one good for the other

Perfect substitutes: •Perfect complements:

- Two goods with straight-line indifference curves - Two goods with right-angle indifference curves
(constant MRS) - Left shoe and right shoe. The {10 left shoes, 5 right
- quarters and one-dollar bills: always trade 4 shoes} combination is just as good as the {5 left
quarters for one one-dollar bill. shoes, 5 right shoes} one.
 Example of Indifference Curve

Indifference curves for close

Indifference curves for close substitutes
complements are very
are not very bowed.
bowed.
 Latihan Soal

Jeihan, who recently graduated from the Faculty of Economics and Business at Universitas
Indonesia, currently works for one of the top economic and business consulting firms in Jakarta. As
a fresh graduate, Jeihan receives a starting monthly salary of Rp 6,000,000. Suppose that Jeihan’s
current consumption bundles consist of 2 items, i.e. food, which costs him Rp 30,000 per portion
and drinks, which cost him Rp 20,000 per bottle. Consider that food and drinks are normal goods for
Jeihan.

a. Write the equation of Jeihan’s budget constraint. Find the slope of the budget constraint.
Illustrate Jeihan’s budget constraint in the graph, place food on the x axis. [5]
b. Let say that Jeihan has reached his consumer equilibrium when consuming 100 portions of food
and 150 bottles of drinks. Draw the equilibrium in the graph and label it as A. Use the theory of
consumer equilibrium to explain why A is an optimal point for Jeihan. [5]
c. The long drought has incited the increase in the price of food to Rp 40,000 per portion. Write the
equation of Jeihan’s new budget constraint. Find out the slope of the new budget constraint and
illustrate it in the graph. [5]